153 scra 399

G.R. No. L-50444 August 31, 1987

ANTIPOLO REALTY CORPORATION, petitioner,
vs.
THE NATIONAL HOUSING AUTHORITY, HON. G.V. TOBIAS, in his
capacity as General Manager of the National Housing Authority, THE
HON. JACOBO C. CLAVE, in his capacity as Presidential Executive
Assistant and VIRGILIO A. YUSON, respondents.
FELICIANO, J.:
By virtue of a Contract to Sell dated 18 August 1970, Jose Hernando
acquired prospective and beneficial ownership over Lot. No. 15, Block IV of
the Ponderosa Heights Subdivision in Antipolo, Rizal, from the petitioner
Antipolo Realty Corporation.
On 28 August 1974, Mr. Hernando transferred his rights over Lot No. 15 to
private respondent Virgilio Yuson. The transfer was embodied in a Deed of
Assignment and Substitution of Obligor (Delegacion), executed with the
consent of Antipolo Realty, in which Mr. Yuson assumed the performance of
the vendee's obligations under the original contract, including payment of
his predecessor's installments in arrears. However, for failure of Antipolo
Realty to develop the subdivision project in accordance with its undertaking
under Clause 17 of the Contract to Sell, Mr. Yuson paid only the arrearages
pertaining to the period up to, and including, the month of August 1972 and
stopped all monthly installment payments falling due thereafter Clause 17
reads:
Clause 17. SUBDIVISION BEAUTIFICATION. To insure the
beauty of the subdivision in line with the modern trend of urban
development, the SELLER hereby obligates itself to provide the
subdivision with:
a) Concrete curbs and gutters
b) Underground drainage system
c) Asphalt paved roads
d) Independent water system
e) Electrical installation with concrete posts.

f) Landscaping and concrete sidewall

g) Developed park or amphi-theatre
h) 24-hour security guard service.
These improvements shall be complete within a period of two
(2) years from date of this contract.Failure by the SELLER shall
permit the BUYER to suspend his monthly installments without
any penalties or interest charges until such time that such
improvements shall have been completed. 1
On 14 October 1976, the president of Antipolo Realty sent a notice to
private respondent Yuson advising that the required improvements in the
subdivision had already been completed, and requesting resumption of
payment of the monthly installments on Lot No. 15. For his part, Mr. Yuson
replied that he would conform with the request as soon as he was able to
verify the truth of the representation in the notice.
In a second letter dated 27 November 1976, Antipolo Realty reiterated its
request that Mr. Yuson resume payment of his monthly installments, citing
the decision rendered by the National Housing Authority (NHA) on 25
October 1976 in Case No. 252 (entitled "Jose B. Viado Jr., complainant vs.
Conrado S. Reyes, respondent") declaring Antipolo Realty to have
"substantially complied with its commitment to the lot buyers pursuant to
the Contract to Sell executed by and between the lot buyers and the
respondent." In addition, a formal demand was made for full and immediate
payment of the amount of P16,994.73, representing installments which,
Antipolo Realty alleged, had accrued during the period while the
improvements were being completed i.e., between September 1972 and
October 1976.
Mr. Yuson refused to pay the September 1972-October 1976 monthly
installments but agreed to pay the post October 1976 installments. Antipolo
Realty responded by rescinding the Contract to Sell, and claiming the
forfeiture of all installment payments previously made by Mr. Yuson.
Aggrieved by the rescission of the Contract to Sell, Mr. Yuson brought his
dispute with Antipolo Realty before public respondent NHA through a
letter-complaint dated 10 May 1977 which complaint was docketed in NHA
as Case No. 2123.

Antipolo Realty filed a Motion to Dismiss which was heard on 2 September

1977. Antipolo Realty, without presenting any evidence, moved for the
consolidation of Case No. 2123 with several other cases filed against it by
other subdivision lot buyers, then pending before the NHA. In an Order
issued on 7 February 1978, the NHA denied the motion to dismiss and
scheduled Case No. 2123 for hearing.
After hearing, the NHA rendered a decision on 9 March 1978 ordering the
reinstatement of the Contract to Sell under the following conditions:
l) Antipolo Realty Corporation shall sent [sic] to Virgilio Yuzon a
statement of account for the monthly amortizations from
November 1976 to the present;
m) No penalty interest shall be charged for the period from
November 1976 to the date of the statement of account; and
n) Virgilio Yuzon shall be given sixty (60) days to pay the arrears
shown in the statement of account. 2
Antipolo Realty filed a Motion for Reconsideration asserting: (a) that it had
been denied due process of law since it had not been served with notice of
the scheduled hearing; and (b) that the jurisdiction to hear and decide Mr.
Yuson's complaint was lodged in the regular courts, not in the NHA, since
that complaint involved the interpretation and application of the Contract to
Sell.
The motion for reconsideration was denied on 28 June 1978 by respondent
NHA General Manager G.V. Tobias, who sustained the jurisdiction of the
NHA to hear and decide the Yuson complaint. He also found that Antipolo
Realty had in fact been served with notice of the date of the hearing, but
that its counsel had failed to attend the hearing. 3 The case was submitted
for decision, and eventually decided, solely on the evidence presented by
the complainant.
On 2 October 1978, Antipolo Realty came to this Court with a Petition for
certiorari and Prohibition with Writ of Preliminary Injunction, which was
docketed as G.R. No. L-49051. Once more, the jurisdiction of the NHA was
assailed. Petitioner further asserted that, under Clause 7 of the Contract to
Sell, it could validly terminate its agreement with Mr. Yuson and, as a
consequence thereof, retain all the prior installment payments made by the
latter. 4

This Court denied certiorari in a minute resolution issued on 11 December

1978, "without prejudice to petitioner's pursuing the administrative
remedy." 5 A motion for reconsideration was denied on 29 January 1979.
Thereafter, petitioner interposed an appeal from the NHA decision with the
Office of the President which, on 9 March 1979, dismissed the same
through public respondent Presidential Executive Assistant Jacobo C.
Clave. 6
In the present petition, Antipolo Realty again asserts that, in hearing the
complaint of private respondent Yuson and in ordering the reinstatement of
the Contract to Sell between the parties, the NHA had not only acted on a
matter beyond its competence, but had also, in effect, assumed the
performance of judicial or quasi-judicial functions which the NHA was not
authorized to perform.
We find the petitioner's arguments lacking in merit.
It is by now commonplace learning that many administrative agencies
exercise and perform adjudicatory powers and functions, though to a
limited extent only. Limited delegation of judicial or quasi-judicial authority
to administrative agencies (e.g., the Securities and Exchange Commission
and the National Labor Relations Commission) is well recognized in our
jurisdiction, 7 basically because the need for special competence and
experience has been recognized as essential in the resolution of questions
of complex or specialized character and because of a companion recognition
that the dockets of our regular courts have remained crowded and clogged.
In Spouses Jose Abejo and Aurora Abejo, et al. vs. Hon. Rafael dela Cruz,
etc., et al., 8 the Court, through Mr. Chief Justice Teehankee, said:
In the fifties, the Court taking cognizance of the move to vest
jurisdiction in administrative commissions and boards the power
to resolve specialized disputes in the field of labor (as in
corporations, public transportation and public utilities) ruled
that Congress in requiring the Industrial Court's intervention in
the resolution of labor management controversies likely to
cause strikes or lockouts meant such jurisdiction to be
exclusive, although it did not so expressly state in the law. The
Court held that under the "sense-making and expeditious
doctrine of primary jurisdiction . . . the courts cannot or will not
determine a controversy involving a question which is within
the jurisdiction of an administrative tribunal where the question
demands the exercise of sound administrative discretion

requiring the special knowledge, experience, and services of the

administrative tribunal to determine technical and intricate
matters of fact, and a uniformity of ruling is essential to comply
with the purposes of the regulatory statute
administered" (Pambujan Sur United Mine Workers v. Samar
Mining Co., Inc., 94 Phil, 932, 941 [1954]).
In this era of clogged court dockets, the need for specialized
administrative boards or commissions with the special
knowledge, experience and capability to hear and determine
promptly disputes on technical matters or essentially factual
matters, subject to judicial review in case of grave abuse of
discretion has become well nigh indispensable. Thus, in 1984,
the Court noted that 'between the power lodged in an
administrative body and a court, the unmistakeable trend has
been to refer it to the former, "Increasingly, this Court has been
committed to the view that unless the law speaks clearly and
unequivocably, the choice should fall on fan administrative
agency]" ' (NFL v. Eisma, 127 SCRA 419, 428, citing
precedents). The Court in the earlier case of Ebon vs. De
Guzman (113 SCRA 52, 56 [1982]), noted that the lawmaking
authority, in restoring to the labor arbiters and the NLRC their
jurisdiction to award all kinds of damages in labor cases, as
against the previous P.D. amendment splitting their jurisdiction
with the regular courts, "evidently, . . . had second thoughts
about depriving the Labor Arbiters and the NLRC of the
jurisdiction to award damages in labor cases because that setup
would mean duplicity of suits, splitting the cause of action and
possible conflicting findings and conclusions by two tribunals on
one and the same claim."
In an even more recent case, Tropical Homes, Inc. vs. National Housing
Authority, et al., 9 Mr. Justice Gutierrez, speaking for the Court, observed
that:
There is no question that a statute may vest exclusive original
jurisdiction in an administrative agency over certain disputes
and controversies falling within the agency's special expertise.
The very definition of an administrative agency includes its
being vested with quasi-judicial powers. The ever increasing
variety of powers and functions given to administrative agencies
recognizes the need for the active intervention of administrative
agencies in matters calling for technical knowledge and speed

in countless controversies which cannot possibly be handled by

regular courts.
In general the quantum of judicial or quasi-judicial powers which an
administrative agency may exercise is defined in the enabling act of such
agency. In other words, the extent to which an administrative entity may
exercise such powers depends largely, if not wholly, on the provisions of the
statute creating or empowering such agency. 10 In the exercise of such
powers, the agency concerned must commonly interpret and apply
contracts and determine the rights of private parties under such contracts.
One thrust of the multiplication of administrative agencies is that the
interpretation of contracts and the determination of private rights
thereunder is no longer a uniquely judicial function, exercisable only by our
regular courts.
Thus, the extent to which the NHA has been vested with quasi-judicial
authority must be determined by referring to the terms of Presidential
Decree No. 957, known as "The Subdivision and Condominium Buyers'
Decree." 11 Section 3 of this statute provides as follows:
National Housing Authority. The National Housing Authority
shall have exclusive jurisdiction to regulate the real estate trade
and business in accordance with the provisions of this decree
(emphasis supplied)
The need for and therefore the scope of the regulatory authority thus
lodged in the NHA are indicated in the second and third preambular
paragraphs of the statute which provide:
WHEREAS, numerous reports reveal that many real estate
subdivision owners, developers, operators, and/or sellers
have reneged on their representations and obligations to
provide and maintain properly subdivision roads, drainage,
sewerage, water systems lighting systems and other similar
basic requirements, thus endangering the health and safety of
home and lot buyers;
WHEREAS, reports of alarming magnitude also show cases of
swindling and fraudulent manipulations perpetrated by
unscrupulous subdivision and condominium sellers and
operators, such as failure to deliver titles to the buyers or titles
free from liens and encumbrances, and to pay real estate taxes,

and fraudulent sales of the same subdivision lots to different

innocent purchasers for value . (emphasis supplied)
Presidential Decree No. 1344 12 clarified and spelled out the quasi-judicial
dimensions of the grant of regulatory authority to the NHA in the following
quite specific terms:
SECTION 1. In the exercise of its functions to regulate the real
estate trade and business and in addition to its powers provided
for in Presidential Decree No. 957, the National Housing
Authority shall have exclusive jurisdiction to hear and decide
cases of the following nature:
A. Unsound real estate business practices:
B. Claims involving refund and any other claims filed by subdivision lot or condominium unit buyer against the project
owner, developer, dealer, broker or salesman; and
C. Cases involving specific performance of contractual and
statutory obligations filed by buyers of subdivision lots or
condominium units against the owner, developer, dealer, broker
or salesman.(emphasis supplied.)
The substantive provisions being applied and enforced by the NHA in the
instant case are found in Section 23 of Presidential Decree No. 957 which
reads:
Sec. 23. Non-Forfeiture of Payments. No installment payment
made by a buyer in a subdivision or condominium project for the
lot or unit he contracted to buy shall be forfeited in favor of the
owner or developer when the buyer, after due notice to the
owner or developer, desists from further payment due to the
failure of the owner or developer to develop the subdivision or
condominium project according to the approved plans and
within the time limit for complying with the same. Such buyer
may, at his option, be reimbursed the total amount paid
including amortization and interests but excluding delinquency
interests, with interest thereon at the legal rate. (emphasis
supplied.)
Having failed to comply with its contractual obligation to complete certain
specified improvements in the subdivision within the specified period of two

years from the date of the execution of the Contract to Sell, petitioner was
not entitled to exercise its options under Clause 7 of the Contract. Hence,
petitioner could neither rescind the Contract to Sell nor treat the
installment payments made by the private respondent as forfeited in its
favor. Indeed, under the general Civil Law, 13 in view of petitioner's breach
of its contract with private respondent, it is the latter who is vested with the
option either to rescind the contract and receive reimbursement of an
installment payments (with legal interest) made for the purchase of the
subdivision lot in question, or to suspend payment of further purchase
installments until such time as the petitioner had fulfilled its obligations to
the buyer. The NHA was therefore correct in holding that private
respondent's prior installment payments could not be forfeited in favor of
petitioner.
Neither did the NHA commit any abuse, let alone a grave abuse of
discretion or act in excess of its jurisdiction when it ordered the
reinstatement of the Contract to Sell between the parties. Such
reinstatement is no more than a logical consequence of the NHA's correct
ruling, just noted, that the petitioner was not entitled to rescind the
Contract to Sell. There is, in any case, no question that under Presidential
Decree No. 957, the NHA was legally empowered to determine and protect
the rights of contracting parties under the law administered by it and under
the respective agreements, as well as to ensure that their obligations
thereunder are faithfully performed.
We turn to petitioner's assertion that it had been denied the right to due
process. This assertion lacks substance. The record shows that a copy of the
order denying the Motion to Dismiss and scheduling the hearing of the
complaint for the morning of 6 March 1978, was duly served on counsel for
petitioner, as evidenced by the annotation appearing at the bottom of said
copy indicating that such service had been effected. 14 But even if it be
assumed, arguendo, that such notice had not been served on the petitioner,
nevertheless the latter was not deprived of due process, for what the
fundamental law abhors is not the absence of previous notice but rather the
absolute lack of opportunity to be heard. 15 In the instant case, petitioner
was given ample opportunity to present its side and to be heard on a motion
for reconsideration as well, and not just on a motion to dismiss; the claim of
denial of due process must hence sound even more hollow. 16
We turn finally to the question of the amount of P16,994.73 which petitioner
insists had accrued during the period from September 1972 to October
1976, when private respondent had suspended payment of his monthly
installments on his chosen subdivision lot. The NHA in its 9 March 1978

resolution ruled that the regular monthly installments under the Contract to
Sell did not accrue during the September 1972 October 1976 period:
[R]espondent allowed the complainant to suspend payment of
his monthly installments until the improvements in the
subdivision shall have been completed. Respondent informed
complainant on November 1976 that the improvements have
been completed. Monthly installments during the period of
suspension of payment did not become due and demandable
Neither did they accrue Such must be the case, otherwise, there
is no sense in suspending payments. If the suspension is lifted
the debtor shall resume payments but never did he incur any
arrears.
Such being the case, the demand of respondent for complainant
to pay the arrears due during the period of suspension of
payment is null and void. Consequently, the notice of
cancellation based on the refusal to pay the s that were not due
and demandable is also null and void. 17
The NHA resolution is probably too terse and in need of certification and
amplification. The NHA correctly held that no installment payments should
be considered as having accrued during the period of suspension of
payments. Clearly, the critical issue is what happens to the installment
payments which would have accrued and fallen due during the period of
suspension had no default on the part of the petitioner intervened. To our
mind, the NHA resolution is most appropriately read as directing that
the original period of payment in the Contract to Sell must be deemed
extended by a period of time equal to the period of suspension (i.e., by four
(4) years and two (2) months) during which extended time (tacked on to the
original contract period) private respondent buyer must continue to pay the
monthly installment payments until the entire original contract price shall
have been paid. We think that such is the intent of the NHA resolution
which directed that "[i]f the suspension is lifted, the debtor shall resume
payments" and that such is the most equitable and just reading that may be
given to the NHA resolution. To permit Antipolo Realty to collect the
disputed amount in a lump sum after it had defaulted on its obligations to
its lot buyers, would tend to defeat the purpose of the authorization (under
Sec. 23 of Presidential Decree No. 957, supra) to lot buyers to suspend
installment payments. As the NHA resolution pointed out, [s]uch must be
the case, otherwise, there is no sense in suspending payments." Upon the
other hand, to condone the entire amount that would have become due
would be an expressively harsh penalty upon the petitioner and would result

in the unjust enrichment of the private respondent at the expense of the

petitioner. It should be recalled that the latter had already fulfilled, albeit
tardily, its obligations to its lot buyers under their Contracts to Sell. At the
same time, the lot buyer should not be regarded as delinquent and as such
charged penalty interest. The suspension of installment payments was
attributable to the petitioner, not the private respondent. The tacking on of
the period of suspension to the end of the original period precisely prevents
default on the part of the lot buyer. In the words of the NHA resolution,
"never would [the buyer] incur any arrears."
WHEREFORE, the Petition for certiorari is DISMISSED. The NHA decision
appealed from is hereby AFFIRMED and clarified as providing for the
lengthening of the original contract period for payment of installments
under the Contract to Sell by four (4) years and two (2) months, during
which extended time private respondent shall continue to pay the regular
monthly installment payments until the entire original contract price shall
have been paid. No pronouncement as to costs.
SO ORDERED.